Eurofinanz Group

BOOT/BOO

The private provision of public services has emerged as one of the most innovative new developments for the distribution of public goods. There are many methods in which privately developed infrastructure projects can be financed. While there are many other arrangements, Build-Own Operate (BOO), and Build-Own-Operate-Transfer (BOOT) are the more common methods of financing.

These financing methods are immensely complex in financial and legal terms and require an extended period of time to develop and negotiate.

Both of them are used in projects that involve new facilities and require financing to construct them. The sponsoring consortium financing the project takes care of the construction and operations of the facilities as owners and is expected to transfer them (in BOOT case) back to the host government at some future date, normally at no cost.

The three main areas of infrastructure that BOO and BOOT methods are applied to are telecommunications, road transportation, and power generation.

Financing methods such as BOO and BOOT have great potential to reduce the cost of infrastructure development through capital and operating cost savings.

As these financing methods become better understood and standard solutions to problems are better accepted, BOO and BOOT, and other methods will be easier to negotiate and implement in the future.

Corporate Funding

Projects often require funding and a transfer of technology from the more developed countries to stimulate economic growth.

EUROFINANZ advises and assists corporations to enter foreign markets and expand their physical presence in the emerging markets.

We can arrange funding, in compliance with the legal requirements of the countries involved:

• Initial Public Offerings
• ADR's
• Preferred shares
• Convertible loan stock
• Company restructuring
• Debentures and bonds
• Medium and Long term
sources of finance

Securitization

To date, local banks have maintained careful policies to grant long term loans. Mostly, due to the risk of liquidity represented by the assignment of credits, which immobilizes funds and reduces lending capability.

Increase in system efficiency requires not only the restructuring of lesser competitive banks but the innovation of the whole system based on new financial instruments implementation.

Costs and lack of credit -specially for emerging economies- are the two great barriers that securitization looks for elimination. Securitization allows low liquidity investments, as immovables, into securities tradable in capital markets, with high liquidity and acceptance by a lot of investors.

Securitization is a financial technique whereby a pool of credits originated by one or more Originators is separated from their balance–sheet and transferred to a legal vehicle (SPV) which will obtain necessary funds to purchase them through the issuance and sale of securities guaranteed by such transferred portfolio.

Securities' purchasers may be institutional investors such as mutual or pension funds, or thousands of small investors who buy certificates of participation through public offerings.

Forfaiting

Globalization and higher growth rates in most Latin American countries are responsible for the substancial increase in these countries' trade volumes. In order to stay competitive and improve the region's trade deficits, Latin American exporters will have to become more innovative and take advantage of the products used daily by their competitors in the remainder of the world, primarily in Europe and Japan.

Forfaiting techniques can offer flexible solutions and not only advance inter-Latin American trade but also assist in opening up the remainder of the world to trade finance in Latin America. By using forfaiting it is possible to get financing for foreign trade transactions on a “without recourse” basis, i.e. exporter sells payment instruments and Forfaiter assumes the responsibility to claim the debt to importer.

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